Selling pressure gathered momentum after the yellow metal in overseas markets suffered heavy losses, sparking a major sell-off in the local market here, pushing it down to a level seen on September 7 last year, traders said.
Similarly, silver paired all the gains it made in yesterday's trade by losing Rs 2,200 to Rs 58,300 per kg, as speculators offloaded their position for month-end settlements on the Multi Commodity Exchange.
The trading sentiment in gold dampened as in global markets it fell by USD 100 to trade below to hit the USD 1,700 an ounce level on signs that the Federal Reserve will refrain from offering more monetary stimulus to boost the US economy.
In New York last evening, gold tumbled by USD 100, or 5.6 per cent, to USD 1,688.40 an ounce, the lowest level since January 25.
In addition, retail customers here refraining from purchasing gold at existing higher levels, also dampened the trading sentiment to some extent.
On the domestic front, the gold of 99.9 and 99.5 per cent purity tumbled by Rs 920 each to Rs 28,140 and Rs 28,000 per 10 grams, respectively.
Sovereigns followed suit and declined by Rs 50 to Rs 23,500 per piece of eight grams.
In a similar fashion, silver ready nosedived by Rs 2,200 to Rs 58,300 per kg and weekly-based delivery by Rs 1,570 to Rs 59,600 per kg. The metal had spurted by Rs 2,050 yesterday.
Silver coins also dropped by Rs 2,000 to Rs 72,000 for buying and Rs 73,000 for selling of 100 pieces on all in demand at prevailing higher levels.